Gap Inc. (NYSE: GPS) said on Thursday that its sales in the fiscal fourth quarter posted a 5% annualised decline as the Coronavirus pandemic pushed it into temporarily closing its stores and restricted people to their homes.
Gap shares were reported close to 3.5% up in after-hours trading on Thursday. Including the price action, the stock is now exchanging hands at £18.96 per share after recovering from a low of £3.96 per share in the first week of April when the COVID-19 crisis was at its peak. The price action should come in handy if you are interested in investing in the stock market.
Gap’s Q4 financial results versus analysts’ estimates
Gap said that its net income in the fourth quarter printed at £168.67 million, that translates to 43.97 pence per share. In the comparable quarter of last year, it had posted £132.63 million of loss, or 35.32 pence per share.
The San Francisco-based company’s earnings in Q4 included non-recurring tax benefits of 32.44 pence per share and its Intermix business-related impairment charges worth 8.65 pence per share. The retailer said that it generated £3.19 billion of revenue in the recent quarter versus the year-ago figure of £3.37 billion.
According to FactSet, experts had forecast the company to report £3.36 billion of sales in the fourth quarter. Their estimate for adjusted per-share earnings stood at 13.70 pence per share.
Other prominent figures in Gap’s earnings report on Thursday include a 5% year over year growth in Old Navy sales and a 29% increase in Athleta sales. Its namesake brand and Banana Republic, on the other hand, recorded a 19% decline in net sales and a 27% decline, respectively.
Gap’s financial performance in fiscal 2020
For the full financial year, the American clothing company valued its sales at £9.95 billion – a decline from £11.81 billion in 2019. Its loss stood at £479.33 million, or £1.28 per share in 2020, versus £253 million of net income in the previous year or 67.03 pence per share.
Analysts, on the other hand, had called for £10.09 billion of revenue, and £1.59 of per-share loss. In the prior quarter (Q3), Gap had registered £2.99 billion of net sales.
Gap performed fairly upbeat in the stock market last year with an annual gain of close to 15%. At the time of writing, it has a market capitalisation of £6.84 billion.
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Wajeeh Khan
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